PA 15-178—sHB 6984

Energy and Technology Committee


SUMMARY: This act extends the potential duration of the revenue adjustment mechanism (RAM) that the Public Utilities Regulatory Authority (PURA) approves for PURA-regulated water companies between a company's general rate cases. In general, a RAM allows a company to annually adjust rates to reconcile any difference between its PURA-approved revenue and its actual revenue without going through a full rate case proceeding each year (e. g. , if a company earns less than PURA allowed it to earn, a RAM adjusts the next year's rates to make up the difference). The law allows these water companies to implement a RAM between rate cases under certain limited circumstances.

Under prior law, when PURA approved a RAM between rate cases, it had to annually reauthorize the RAM until the earlier of (1) six years after the company's last rate case or (2) the company's next rate case (at which point, the rates are adjusted to provide the company's approved revenue, and a new RAM can be approved at the company's request). The act instead requires annual reauthorizations until the later of the sixth year after the company:

1. filed its last rate case;

2. initially established a RAM; or

3. had a prior rate case reopened and PURA either (a) reset rate levels, (b) rolled Water Infrastructure and Conservation Adjustment surcharges into base rates, or (c) made other authorized rate changes under a settlement agreement or other action.

After the six-year period, the act allows PURA to extend the company's RAM for an additional three years at the company's request. A company seeking an extension must file a request at least 90 days before its RAM expires, and PURA must act on the request in an uncontested proceeding before the RAM expires.

EFFECTIVE DATE: October 1, 2015

OLR Tracking: LRH; DC; TA; BS